Correlation Between Allied Gaming and Betmakers Technology

Can any of the company-specific risk be diversified away by investing in both Allied Gaming and Betmakers Technology at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Allied Gaming and Betmakers Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Allied Gaming Entertainment and Betmakers Technology Group, you can compare the effects of market volatilities on Allied Gaming and Betmakers Technology and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Allied Gaming with a short position of Betmakers Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allied Gaming and Betmakers Technology.

Diversification Opportunities for Allied Gaming and Betmakers Technology

-0.42

Correlation Coefficient

Allied Gaming  Betmakers Technology

Very good diversification

The 3 months correlation between Allied and Betmakers is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Allied Gaming Entertainment and Betmakers Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Betmakers Technology and Allied Gaming is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Allied Gaming Entertainment are associated (or correlated) with Betmakers Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Betmakers Technology has no effect on the direction of Allied Gaming i.e., Allied Gaming and Betmakers Technology go up and down completely randomly.

Pair Corralation between Allied Gaming and Betmakers Technology

Given the investment horizon of 90 days Allied Gaming Entertainment is expected to generate 0.8 times more return on investment than Betmakers Technology. However, Allied Gaming Entertainment is 1.25 times less risky than Betmakers Technology. It trades about 0.34 of its potential returns per unit of risk. Betmakers Technology Group is currently generating about 0.22 per unit of risk. If you would invest  76.00  in Allied Gaming Entertainment on October 25, 2024 and sell it today you would earn a total of  24.00  from holding Allied Gaming Entertainment or generate 31.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	85.71%
Values	Daily Returns

Allied Gaming Entertainment  vs.  Betmakers Technology Group

Allied Gaming Entert

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Allied Gaming Entertainment has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Betmakers Technology

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Betmakers Technology Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Betmakers Technology reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Allied Gaming and Betmakers Technology

The main advantage of trading using opposite Allied Gaming and Betmakers Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allied Gaming position performs unexpectedly, Betmakers Technology can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Betmakers Technology will offset losses from the drop in Betmakers Technology's long position.

The idea behind Allied Gaming Entertainment and Betmakers Technology Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.